Transferring Special Declarant Rights
In Part 1 of our series on special declarant rights we explained the general nature of those rights and how long they can last. Here, in Part 2, we explore the requirements of transferring those rights from one person or company to another.
As with most aspects of planned communities, the North Carolina Planned Community Act includes a section regulating the transfer of special declarant rights. Section 47F-3-104 requires that any transfer of special declarant rights be done by a written instrument reciting the transfer recorded in every county which any portion of the subdivision is located. Except for the transfer of declarant rights resulting from foreclosure or similar proceedings, the instrument transferring special declarant rights is not effective unless it is signed by the recipient.
Transfer of special declarant rights does not relieve the developer from any obligation or warranty that arose before the transfer and the developer remains liable for the obligations required by the Planned Community Act. If the entity receiving the transfer of special declarant rights is an affiliate of the developer, the developer is jointly and severally liable with the affiliate for any obligations or liabilities of the successor relating to the development.
Please contact our office so that we can advise you on issues that need to be addressed as part of a transfer of special declarant rights and termination of declarant control.